Applicability of Income Computation and Disclosure Standards notified under section 145(2) of the Income-tax Act, 1961

It is a pleasure to inform that the Central Board of Direct Taxes has vide Press Release dated 6.07.2016 clarified that the Income Computation & Disclosure Standards shall be applicable from 1.4.2016 i.e. previous year 2016-17 (Assessment Year 2017-18).

It is pertinent to inform that the Direct Taxes Committee of ICAI made detailed representation to Central Board of Direct Taxes during the Direct Tax Workshop with CBDT which was followed by written representation to Chairman, CBDT on 31.03.2016 and Hon’ble Finance Minister, on 7.04.2016 (For copy click here) for deferment of implementation of ICDS. On invitation by CBDT subsequently, the ICAI representatives met Joint Secretary (TPL-I) and Director (TPL-III) at North Block, New Delhi on 18th April, 2016 and 27th April, 2016 and made detailed presentation on difficulties that would be faced by stakeholders on implementation of ICDS. The issues raised by ICAI were considered positively by the Expert Committee on ICDS in meeting held on 12.05.2016 and ICAI was asked to prepare detailed FAQs and amendments to ICDS which were submitted on 20.05.2016 (For copy click here).

The CBDT officials agreed to most of ICAI’s recommendations and also agreed to bring out clarifications by way of issuing FAQ’s and amendments in ICDS. However, in view of delay in redressal of issues in ICDS, pending notification of FAQs and non-revision of tax audit report formats, it was requested to Finance Minister that implementation of ICDS and notification of revised tax audit report formats be postponed vide meeting & letter dated 28.06.2016 (For copy click here). We are thankful to the Government for favourably responding to the concerns of the stakeholders that were put forward by ICAI and deferring applicability of ICDS by one year.

Income Disclosure Scheme, 2016

It is really heartening that our Government is taking path breaking initiatives in the direction of channelizing resources, promoting ease of doing business, having inclusive growth and so on. ICAI as Partner in Nation Building has always been working towards facilitating the objectives of the Government and at the same time emphasizing on “Ease of doing Business for Business & Industry” We are happy to share with you that presently ICAI is facilitating the success of Income Disclosure Scheme, 2016. On 2nd July 2016 we conducted more than 100 Citizen & Member Awareness Programme across the length and breadth of country to provide useful knowledge of the scheme. A Special Address of Shri Arun Jaitley, Hon’ble Minister of Corporate Affairs and Finance were also webcasted at the awareness programmes. On the occasion the scheme was threadbare explained by Shri Hasmukh Adhia, Revenue Secretary, Shri Atulesh Jindal, Chairman, CBDT, Ms Rani S Nair, Member, CBDT, CA. Girish Ahuja and questions raised by stakeholders were responded.

But we believe that the success of the income disclosure scheme lies in your hands. Please propagate the benefit of scheme and advise your clients and others to take its advantage. It is golden opportunity to make tax avoiders understand their past mistakes and rectify it by paying taxes to join the mainstream. In Bhagwad Gita it is given that – It is necessary to consider what is right action, what is wrong action, and what is inaction, for mysterious is the law of action. As Chartered Accountant it is our noble duty to Act for the overall good.